Settle dispute by arbitration

Disputes between farm owners, employees and families can have a devastating impact on people and happen all too often in the rural community.

A recent prosecution, where a Coromandel farmer reneged on his agreement on milk payments to his sharemilkers, resulted in him receiving a 12-month prison sentence and a sharemilking couple failing to meet their goal of farm ownership.

This may be an extreme case but, unfortunately, disputes are common in farming.

There are an increasing number of areas which can spark a dispute, from contractual issues to effluent management to leasing agreements.

The Arbitrators' and Mediators' Institute of New Zealand, (AMINZ) expects Fonterra's Trading Among Farmers scheme will produce conflict between owners and sharemilkers.

Federated Farmers has a Memorandum of Understanding (MOU) with AMINZ, the country's largest professional institute for people working in dispute resolution.

For those in sharemilking, the MOU provides clear pathways for resolving disputes, with provision for conciliation and arbitration led by AMINZ into Variable Order Sharemilking contracts.

As well as avoiding the expensive court system in resolving disputes, the conciliation and arbitration offered by AMINZ provides an independent and neutral perspective on the situation which can ensure parties can move beyond the personal.

AMINZ can help people communicate more effectively with each other, allowing them to get past petty point scoring to find a mutually beneficial solution.

AMINZ executive director Deborah Hart outlined a recent example of a contract milking couple who leased out their stock to a farm owner using a formal stock lease agreement. It provided for any replacements to be on a "like for like" basis.

"Unfortunately, when the stock was returned, many were not in calf, other stock had low body condition scores and the replacement stock offered lower breeding worth (BW) than the cows originally provided," she said.

The contract milkers and the farmer were unable to reach an agreement and went to AMINZ for a conciliation process.

Once this began, they were able to reach an agreement on the same day.

This included compensation being made to the cows' owners and replacement stock provided by the farmer.

The relationships between farm owners and herd-owning sharemilkers is another area which is often fraught with potential for dispute, with conflict often arising around the areas of body condition scores, milk production and timing of calving.

The disputes can rumble on, potentially leading to explosive disagreements if not confronted and settled.

Federated Farmers Dairy Industry policy advisor Ann Thompson says dealing with disputes early can avoid damaging morale, which can affect the performance of the overall business.

"Federated Farmers' experience is that using professional rural arbitrators and conciliators can lead to lasting resolutions, even after apparent impasses," Thompson said.

"It is better for everyone involved and the wider industry to avoid these situations by better managing relationships."

AMINZ has a vetted list of professionals trained in rural disputes and it also operates the National Panel of Conciliators, who are specifically trained for sharemilking disputes.

Using AMINZ's services means a professionally trained and qualified conciliator with rural experience can help the parties reach a resolution people can live with, Hart says. "In many cases, the parties in dispute need to continue to work together, so this is key."

Hart said it is difficult to imagine in the middle of contentious and often personal dispute that it can be resolved to the point parties can go back to a healthy working relationship.

"But this is the reality rural arbitrators and conciliators facilitate daily."